Name: DELA CRUZ, Chero I.

Year and Section: BSBA FM 3B

Date Submitted: February 07, 2022

 STEPS IN RISK MANAGEMENT

1. Risk Identification
2. Risk Analysis
3. Risk Prioritization
4. Develop Contingency Plan
5. Monitoring
STEP 1: Risk Identification

The following are the 25 Negative Risk that I foresee that could impact my financial aspects and career.

A. Unable to find job after graduate N. Deafness (myself)

B. Failing grades O. Blurring of the eyes because of long exposure on
gadgets
C. Graduate with no academic awards P. Being unhealthy
D. House damage because of calamities Q. Tardiness in class meetings
E. Not graduate on time R. Broke fixtures of the company I work to
F. Getting pregnant before finishing study S. Lost my wallet on the road/PUV
G. Unemployment or job loss T. Unpaid personal loans
H. Accidents at work/outside U. Diarrhea because of filthy foods
I. High electricity bill V. Weak memory because of overthinking
J. Emergency Expense because of Papa's health W. Emotional Stress
condition
K. Low Salary X. Unable to find part time job this year
L. Bad Debts from Debtors Y. Slowdown of Family Business
M. Cellphone use for online class impaired

STEP 2: Risk Analysis

I evaluate the level of risk I listed based on my own analyzation. I used Risk Score=Probability x Impact to
determine the level of risk and to know the appropriate action to reduce the impact of those risk.

5-point rating system for Probability- This is used to rate the possibility of occurrence of risk.

Probability Category Probability Number Description

Very High 5 Risk event expected to occur
High 4 Risk event more likely than not to occur
Probable 3 Risk event may or may not occur
Low 2 Risk event less likely than not to occur
Very Low 1 Risk event not expected to occur
Impact Table - This is used to rate the probable impact of risk. Note: This is only based on my own rating system.

Impact Impact Description

Category Number
Very High 5 Risk impact is severe with the possibility of financial losses and career ruin.
High 4 Risk impact is high with potential financial declining and poor performance in
career.
Moderate 3 Risk impact is moderate with potential limited financial resources and low rate
of performance in career.
Low 2 Risk impact is low with least effect on financial resources and in career.
Very Low 1 Risk impact is very low with no critical effect on financial resources and career.

Negative Risk Probability Impact Level of Risk

A. Unable to find job after graduate 2 5 10
B. Failing grades 2 4 8
C. Graduate with no academic awards 3 3 9
D. House damage because of calamities 4 4 16
E. Not graduate on time 1 4 4
F. Getting pregnant before finishing study 1 5 5
G. Unemployment or job loss 4 5 20
H. Accidents at work/outside 2 3 6
I. High electricity bill 5 4 20
J. Emergency Expense because of Papa's 5 5 25
health condition
K. Low salary 3 4 12
L. Bad Debts from debtors 4 1 4
M. Cellphone use for online class impaired 4 3 12
N. Deafness (myself) 5 3 15
O. Blurring of the eyes because of long 3 2 6
exposure on gadgets
P. Being unhealthy 1 5 5
Q. Tardiness in class meetings 1 3 3
R. Broke fixtures of the company I work to 2 1 2
S. Lost my wallet on the road/PUV 5 2 10
T. Unpaid personal loans 1 2 2
U. Diarrhea because of filthy foods 1 1 1
V. Weak memory because of overthinking 4 2 8
W. Emotional Stress 2 2 4
X. Unable to find part time job this year 3 1 3
Y. Slowdown of family business 3 5 15
 Probability- Impact Matrix
I
P
Impact 1 2 3 4 5
Probability
5 10 15 20 25
4 4 8 12 16 20
3 3 6 9 12 15
2 2 4 6 8 10
1 1 2 3 4 5

Probability- Impact Matrix

I
P
Impact 1 2 3 4 5
Probability
5 10 (S) 15(N) 20 (I) 25 (J)
4 4 (L) 8 (V) 12 (M) 16 (D) 20 (G)
3 3 (X) 6 (O) 9 (C) 12 (K) 15 (Y)
2 2 (R) 4 (W) 6 (H) 8 (B) 10 (A)
1 1 (U) 2 (T) 3 (Q) 4 (E) 5 (F, P)

Probability- Impact Matrix

I
P
Impact VERY LOW LOW MEDIUM HIGH VERY HIGH
Probability
VERY HIGH MEDIUM MEDIUM HIGH HIGH
HIGH LOW MEDIUM MEDIUM HIGH HIGH
MEDIUM LOW MEDIUM MEDIUM MEDIUM HIGH
LOW LOW LOW MEDIUM MEDIUM MEDIUM
VERY LOW LOW LOW LOW LOW MEDIUM
STEP 3: Risk Prioritization

My Top 10 Risk Priority

1 Emergency expense because of Papa’s health condition 25

2 Unemployment or job loss 20
3 High electricity bill 20
4 House damage because of calamities 16
5 Slowdown of family business 15
6 Low Salary 12
7 Unable to find job after graduate 10
8 Failing grades 8
9 Infected by Covid 19 Virus 5
10 Not graduate on time 4

➢ Those highlighted in red colors are risks with high probability of occurring and high consequences that
will greatly affect my family financial capacity and in my career. Those in red colors are risk that may
reduce our family assets like cash and savings that may result from the unexpected imbalances in our
finances. Losing a job or being unemployed is a big risk both in my financial aspect and in my career
because I have no income and I will miss a big opportunity experience that could improve my
credentials.
➢ Those risks that are highlighted in yellow colors are the risk with low/medium level of probability to
occur but has a high consequence. Failing grades will greatly affect my career path because I will not
graduate if my grades are poor or it does not reach the passing grades, and it will be hard for me to look
for a high paid job because I do not have a college degree.
➢ The risk that is not under on my priority risk, are the risk with high probability but has low consequence
that can I cope up or move on and risk with low probability with low consequence, so this risk may be
ignored so I can focus on the risk with high impact on me.
➢ Those risks in my priority risk needed a contingency plan to manage those risks and reduce the possible
impact.
STEP 4: Develop Contingency Plan

Purpose:

➢ Identify the possible impact of each risk listed on the above priority list.
➢ Reduce the impact of risk by creating an action plan.
➢ To help in formulating a budget plan in case of emergency.

Note:

This step focused on giving an alternative plan to reduce the impact of risk on my financial aspects and my
career path.

CONTIGENCY PLAN: EMERGENCY EXPENSE BECAUSE OF PAPA’S HEALTH CONDITION

SITUATION:

Papa’s health is unpredictable. His high blood pressure attack usually causes of stress and environmental
temperature. Every month we buy his medication amounting two-three thousand pesos. He is slowly becoming
weak because of his age. So, it will be risky in our financial aspect if do not have another source of income.
Emergency expense like hospital bill accounts a large percentage of expense that reduces our savings.

Problem:

Papa’s health will at risk if we do not have money to pay his hospital bills or medication.

Impact:

Very high. High emergency expense greatly reduces our family cash flow that could affect our budgetary
plan/savings for household and in business.

Solution:

1. Apply for a family health insurance.

2. Always put my 25% of my salary for emergency savings account for monthly medicine expense.
3. Start to eat healthy foods.

Action plan:

1. Search for a bank that offers a family health insurance with a premium start to 1 000- 3 000 pesos
that is good for 5-10 years of payment.
 2. Set aside immediately the 25% of my salary by depositing it to a bank to avoid using it in unnecessary
things. This savings will be used for monthly expense of Papa’s medicine.

3. Avoid buying pork and Junk foods. Have a list of healthy foods or meal so we can prioritize those
foods in our household budget and help Papa’s to become healthy.

CONTIGENCY PLAN: UNEMPLOYMENT OR JOB LOSS

SITUATION:

I consider this as a future risk. As I observed, there is instances that the company reduces it staff that
result of short term or long-term unemployment of a worker. Unemployment greatly affect the financial aspect
of an individual. Looking for another job is not easy because there is a lot of individuals hunting for a job every
day, month and year.

PROBLEM:

There is probability that may I experience of being unemployed or losing a job so there is no cash inflow in that
time because I do not have any financial resources.

IMPACT:

Very high. Unemployment has great impact on my financial aspects because I do not have any financial
resources if I lost my job because of that, there is possibility that I accept loans.

SOLUTION:

1. Put my savings at least 5-10% of it into an investment for extra source of income while hunting for another
job opportunities.

ACTION PLAN:

1. While I have a work, I will put my 5-10% of my salary to complete the construction of our apartment so my
parent can manage it and they will have their resources while I am focusing to find another job. The target
completion is 1 to 2 years.

2. Avoid accept loans from others or an organization so I will do not have any obligations while I’m still looking
for a job.
 CONTIGENCY PLAN: HIGH ELECTRICITY BILL

SITUATION:

Our family members are too many and Meralco’s electricity consumption rate is continuously increases
that result of high electricity bill. We need to maintain the normal temperature of our house to reduce the
asthma attack of my little brother, so we always open our electric fans day and night. The numbers of members
affect our electricity consumption because each member using gadgets every day.

PROBLEM:

It accounts for high probability of occurring and high impact that reduces and ruin our budget plan for the
household. It needs an immediate payment so we need always a cash on hand to pay this bill every month.

IMPACT:

Very high. High electricity bill increases our expenses and reduces our financial resources. It will greatly affect
our budget plan and our savings.

SOLUTION:

1. Reduce consumption of electricity such as television, refrigerator, computer and lights.

2. Look for alternative light provider.

3. Create a time management plan in using gadgets.

ACTION PLAN:

1.Turn-off appliances such as television, refrigerator, computer, and lights during night time. Electric fans will be
still used day and night as major appliances are turned off during the night. We should set and maintain the
amount of our electricity bill; it should not exceed three thousand pesos every month. We can achieve this if we
control the usage of major appliances in our home.

2. Invest to solar lights. Choose solar light with 45-65W. Buy only 2-3 pieces with the price ranging Php 600-1
000 each. Buy at least 1 every month/ 2 month to reach the target number of solar lights needed.

3. We should charge our cellphone for 2 times a day only. Use gadgets during free time (4 pm to 7 pm) only.
Limit the days of exposure on gadgets (do not use constant the gadgets during Saturday and Sunday)
 CONTIGENCY PLAN: HOUSE DAMAGED BECAUSE OF CALAMITIES

SITUATION:

Our home is not yet done and still need construction to complete it because of that it is not durable in
case of calamities. The roof is the primary concern and the level of ground is low in case of flood. The target to
fix is the first floor.

PROBLEM:

The house is in danger in case of extreme calamity. Our things will be destroyed if we not fixed our home as
soon as possible.

IMPACT:

Very high. The result of damaged house will greatly affect our finances (reduce) to fix our house again. There is a
lot of adjustment in our budget if this happens.

SOLUTION:

1. Give a share to my parents to buy materials for constructing our house (first floor only).

2. Look for a loan for immediate construction of our house.

ACTION PLAN:

1. Give at least 10-20% of my salary to my parents for construction materials. Every other payday I should give
money to my parent for construction. Every month will not be a good idea because the other expenses needed
to pay will be ignored. Target to fix is the first floor of the house in 2 to 3 years.

2. Look for a short-term loan that offers low interest rate only or apply in a self-build loan in an institution. The
target amount of loan must not exceed on five hundred thousand pesos.
 CONTIGENCY PLAN: SLOWDOWN OF FAMILY BUSINESS

SITUATION:

Investing in a real property is not a piece of cake because it requires a lot of capital. I consider this as our
future business risk. The possibility of not getting a client/buyer will be risky as it will not return our investment
if it continuous because we receive nothing or no sales.

PROBLEM:

Having no sales will greatly affect our return on investment and reduces the chance of having an investor.

IMPACT:

Very high. Slowdown of family business reduces our sources of income and increases our expense to survive it.

SOLUTION:

1. Focus to the financial information of the business.

2. Empower our social media marketing to gain buyers.

3. Look for low price contract of backfilling.

ACTION PLAN:

1.Track our expenses to reduce putting our money in large expenses.

2. Widen the dissemination of our offers to social media by inviting more people. Hiring a person to empower
our social media will not be needed and it will be costly so we should learn how to gain more followers to gain
new buyer so we can avoid another expense. Consider first our financial capacity before making decision.

3. Backfilling is the major expenses of our business so we should look for contractor that offers low price to
reduce large expenses. Allocating the 60% of sales to backfilling expenses so the project will be done in 1-2
years. And backfill the targeted area.
 CONTIGENCY PLAN: LOW SALARY

SITUATION:

After I graduated, I expected that my salary would be low because I’m just starting to work in a
corporate world. As well, the salary rates in provincial are still low while the goods in the market are expensive.
The salary rate in city is higher compared to provincial however, the expenses for transportation are also
expensive. Low salary results, unable to save a money for emergency and for future plan.

PROBLEM:

Low salary is equivalent to least financial resources and less likely to save a money. Low salary might impact my
mental state and performance at work.

IMPACT:

High. Low salary has many limitations. It will affect our finances because salary is the major source of income if
our income is low then our finances is not enough to meet our basic needs.

SOLUTION:

1. Look for better opportunities.

2. Work in province (our hometown) instead in city to save transportation fare.

ACTION PLAN:

1. I will start to look for another job that salary will satisfy me and perform well so I will be promoted and my
salary will increase. After I graduate, I should look for a job that offers salary ranging to 15 000 – 20 000 so I can
save money. My savings will be invested to our family business.

2. After I graduate, I will look for a job in our hometown to save transportation fare. The money I save in
transportation will be save on bank. I should be promoted after 3 to 4 years of working.
 CONTIGENCY PLAN: UNABLE TO FIND JOB AFTER GRADUATE

SITUATION:

Job hunting is not easy for a fresh graduate. Unable to find after graduate will be risky in our finances
because my parents are not working, we are depending on our small business so the money we have is not
enough because we also need to priority the medication of our parent. If I do not have job after I graduate there
will be no cash inflow in our family finances.

PROBLEM:

There is low probability that I cannot find a job after graduate but it has a high impact on our finances. No job,
no financial resources, education and health aspect will at risk.

IMPACT:

High. Our finances are not good. We cannot save money and sustain our family business. There is possibility that
my parent’s income cannot cover our daily expenses.

SOLUTION:

1. Plan ahead of time so I will have a job after I graduated.

2. Perform well on our on-the-job-training.

3. Used my savings to build a food business in our area.

ACTION PLAN:

1. 3 months before I graduate, I should start looking a job offers on the internet.

2. Some students are successfully start working in the company they work under their OJT so I should give my
best to successfully be part of the company.

3. If I still not able to find job opportunities in 3 months after I graduate, I will use my savings that I keep for my
employment requirement to a food business in our area so I will have source of income while I am still hunting
for opportunities.
 CONTIGENCY PLAN: FAILING GRADES

SITUATION:

Subjects are becoming difficult when you are near at the stage of graduating in college. Reach the
passing grades is also difficult to achieve. Exam scores is important to raise your grade. If I failed to reach the
passing grades on exam it will result to failing grades on my general grade.

PROBLEM:

Passing grade are requirement to graduate, but if I have failing grades, I will not be able to graduate on time. It
will be hard for me as well to look for a job if I am not graduated.

IMPACT:

High. It will affect my career and I could not be able to help my parents on our finances.

SOLUTION:

1. Ask for help and permission to my professor to give me a project to reach the passing grades.

ACTION PLAN:

1. Before moving another year level I will settle first the subjects that I have failed grades so I will not have any
problems in graduation.

2. I will not stop on studying because of failed grades, I will kindly talk to my professor to give me a project to
comply so I will reach at least the passing grades.

3. Focus on reviewing lessons and set a target score. Ask help to other classmates that better understand the
lessons.
 CONTIGENCY PLAN: BEING UNHEALTHY

SITUATION:

Health is an important aspect in our life to achieve our dream. Because of hectic schedules in school and
household task I forgot to take vitamins to boost my immune system as a result my health becomes weak. My
body reacts when I eat a more food than my usual level of food intake so I cannot increase my weight.

PROBLEM:

Being unhealthy reduces my performance at school and high amount of money spent on buying medicines.

IMPACT:

High. Being sick will reduces my capacity to perform well in academics that might result to low scores and
reduces the savings that my parent has.

SOLUTION:

1. Having a time management and healthy lifestyle

2. Put a budget for vitamins and buy healthy foods.

ACTION PLAN:

1. Create a time management that includes taking vitamins and posted it on the wall so I will not forget it.
Setting priority to take at least 5- 10 mins of stretching. Always set an 8-10 hrs. of sleep to boost my energy.
Recover from sickness first before taking any task at school or in house for early recovery.

2. Allocate a budget for vitamins in every two months and create a list of healthy foods to avoid buying
unhealthy ones. Monitor and maintain my appropriate weight monthly.